When companies justify training spend, they look at the trainees: Are they working faster? Making fewer mistakes? Sticking around longer? A new study by Miguel Espinosa (Bocconi) and Christopher T. Stanton (Harvard Business School), opens an external URL in a new window, published in the June 2026 edition of Harvard Business Manager, shows this calculation misses roughly 45 percent of the actual effect. The hidden lever sits one hierarchy level higher.

The blind spot in L&D measurement

Classic training ROI models — from Kirkpatrick to Phillips — evaluate programs along the trained individual: reaction, learning, behavior change, business result. What happens when that person returns to the team and starts asking fewer questions? What happens with the time their manager gains back? It falls through the cracks.

Espinosa, opens an external URL in a new window and Stanton, opens an external URL in a new window measured exactly that gap.

What the researchers found in Colombia

Between 2018 and 2019, the two academics tracked a Colombian government agency that randomly assigned 12 percent of its customer-facing staff to a 120-hour training program. Content: legal interpretation, written communication, time management, IT skills.

The direct effects were predictable. Four to six months after the program, participants' performance was about 10 percent above baseline. Retention also improved measurably.

The surprising finding came from an analysis of internal email traffic: trained employees contacted their managers significantly less often with detail questions. Managers redeployed the freed-up capacity toward strategic work — with measurable results. They hit 3 percent more of their assigned objectives than before. The effect was strongest among managers who had previously worked closely with the trained employees.

How the spillover mechanism works

The logic is simple, its implications less so. Training doesn't just upgrade an individual's skills — it shifts the division of labor inside the team. Concretely:

• Before training: Employee has a question about a legal interpretation. Manager pauses strategic work, researches, answers, documents.
• After training: Employee finds the answer themselves. Manager keeps focus.

Multiplied across hundreds of such micro-interactions per week, this creates a systematic capacity gain at the management level. Espinosa and Stanton put the share of this indirect value creation at roughly 45 percent of the total program value.

Why classic ROI calculations underweight training

"Evaluations that look only at individual training participants likely substantially underestimate the actual value of educational investments," the authors write. This applies particularly to knowledge-intensive organizations where managers must split their time between operational coaching and strategic work.

Three practical consequences follow:

• First, training is an organizational instrument, not just a people-development one. It alters communication patterns and capacity allocation between hierarchy levels.
• Second, ROI calculations should capture indirect effects. Measuring only participant effects effectively halves the reported value of educational investments — and unintentionally supports every future budget cut.
• Third, program selection changes. Content that builds autonomy and independent problem-solving generates larger spillover effects than narrow technical instruction. Programs that improve cross-hierarchy communication outperform isolated skills training.

What this means for training decisions

The study changes the argument inside budget conversations. Anyone defending training can no longer rely solely on individual learning outcomes — they can point to demonstrable organizational leverage. Anyone cutting training isn't just cutting skills; they're cutting strategic management capacity.

Implications at the intersection of technology and business

Spillover effects are most pronounced where teams must make complex decisions that require hierarchical alignment — that is, precisely at the intersection of technology and business. When specialists learn to translate technical issues into business language, or to ground strategic decisions in technological understanding, the coordination overhead between functions and management drops significantly. In engineering-driven organizations, this translation work typically defaults to senior leadership — and it consumes most of their time.

Programs that combine engineering and business competence therefore don't only produce individual career value. They change who in an organization can talk about what without escalating upward.

What this means for training decisions

The study changes the argument inside budget conversations. Anyone defending training can no longer rely solely on individual learning outcomes — they can point to demonstrable organizational leverage. Anyone cutting training isn't just cutting skills; they're cutting strategic management capacity.

Frequently Asked Questions (FAQ)

What is the actual ROI of executive training?

The Harvard-Bocconi study shows that approximately 45 percent of the total value of a training program comes in the form of spillover effects among the trainees’ supervisors. Traditional ROI models, which measure only the effects on participants, therefore systematically underestimate the actual value.

What are spillover effects in employee development?

Spillover effects describe indirect productivity gains within an organization—for example, when trained employees make fewer inquiries to their supervisors, allowing the latter to devote more of their time to strategic tasks. In the study cited, this led to a 3 percent increase in goal achievement at the management level.

How can one measure the spillover effects of continuing education?

Through communication analyses (email metadata), executives' time-allocation data, and changes in the degree to which goals were achieved. Researchers Espinosa and Stanton used data for this that is already available in most companies.

Which types of professional development programs have the greatest impact on organizations?

Programs that foster autonomy and independent problem-solving generate greater spillover effects than isolated technical training courses. Formats that bridge the gap between technology and business and improve cross-hierarchical communication are particularly effective.

Is continuing education for executives worth it from a financial standpoint?

Yes—and to a greater extent than is often anticipated. The study shows that even small shifts in how executives allocate their time (a 3 percent increase in goal achievement) generate significant value. With traditional measurement methods, this effect remains invisible.